Announcement
GENERAL: DPC: DORCHESTER IMPACTED BY PROPERTY FINANCE MARKET
05:17pm
DPC
25/06/2008
GENERAL
REL: 1717 HRS Dorchester Pacific Limited
GENERAL: DPC: DORCHESTER IMPACTED BY PROPERTY FINANCE MARKET
25 June 2008
Company Announcement
DORCHESTER IMPACTED BY PROPERTY FINANCE MARKET
Dorchester Pacific today announced that Dorchester Finance will withdraw and
not renew its prospectus and will seek the approval of debenture holders and
note holders to a deferred repayment plan, but with continued interest
payments.
Chairman of Dorchester Finance, Mr Barry Graham said: "As a result of the
rapid decline in the property finance market and a continuing fall in
reinvestment rates the Board has formed the view that there is now a risk of
a cash flow shortfall arising in future months."
Mr Graham added "A deferred repayment plan should give us time to realise
property loan positions in an orderly way and ensure full repayment to
debenture holders and note holders."
As at 24 June 2008, Dorchester Finance had $168 million in debenture stock
secured against total assets of $212 million, including $18 million in cash.
In addition it had $8 million in subordinated notes on issue.
The Board intends to work closely with both trustees, Perpetual Trust Limited
and New Zealand Permanent Trustees Limited, and has engaged Grant Samuel and
Associates Limited as an independent adviser to assist in the preparation of
a proposal for investors to consider as soon as practicable.
Mr Graham said "The intention of the deferred repayment plan is to allow us
to repay principal owed to investors over a period of approximately two
years. Although the details are yet to be formulated and agreed with the
Trustees, Dorchester Finance intends to continue to make interest payments.
Repayments of debenture and subordinated note maturities will be suspended
from Thursday 26 June 2008.
"Clearly, taking proactive measures in the current economic environment is
the best way to ensure full return of investors' funds and to preserve value
for stakeholders."
Ends
For more information, please contact:
Barry Graham
Chairman, Dorchester
Tel: 0274 723810
End CA:00166549 For:DPC Type:GENERAL Time:2008-06-25:17:17:27
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